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Are we heading back to landfills?

By
William Perritt, Executive Editor, Wood Biomass Market Report

LOST RIVER, WV,
Dec. 10, 2012
(RISI) -
A Canadian forester recently transplanted to the States asked what sweeping federal policies exist concerning utilization of wood biomass for energy, to which I could only answer, "None." What we do have is a schizophrenic regulatory landscape, in which about 30 states have actual renewable energy targets, but no federal mandate.

With the divisive four-year political cycle, chances are pretty slim a cohesive US renewable energy policy will ever come to bear. Terms like "cap-and-trade" appear in the national dialog, only to be twisted, shot down, and turned into four-letter words before any rational discussion can take place. Little wonder we are no closer to a federal renewable standard now than we were four years ago.

For biomass power producers, the political landscape is particularly tricky. Where wind and solar enjoy widespread public acceptance (well, almost), biomass is often picked to death for being "dirtier than coal" or inaccurately vilified as a deforestation driver.

Insofar as the fuel source is concerned, however, biomass power producers provide a final resting place for the guts and feathers of the forest products industry - and one more value proposition for the original log. Even better, biomass power provides agreeable dispositions for the leftovers of natural disaster.

A good example.

Last month, the US Forest Service announced $13.4 million in forest stewardship contracts to address the monstrous volume of beetle killed lodgepole pine in Colorado and Wyoming. Cleared material will find a home, thanks to the development of wood energy and wood pellet facilities in Colorado (the first state to adopt a renewable portfolio standard). The projects will cover 20,000 acres.

West Range Reclamation of Hotchkiss, CO, will thin diseased and dead trees from the White River National Forest, which will be used to produce power at Eagle Valley Clean Energy's 11 MW plant in Gypsum, CO (currently under development with the help of a $40 million USDA loan guarantee). Eagle Valley will tie into Holy Cross Energy's grid to supply communities in Colorado's famous ski country.

The second contract, awarded to Confluence Energy of Kremmling, CO, will be used to take thinned material from the Medicine Bow-Routt National Forest and produce wood pellets (or higher-value products such as lumber). Confluence, a pellet producer, will pay the Forest Service for the commercially viable material.

With a viable end market for cleared material, thinning projects move forward. And for the Intermountain West, the stakes are high considering last summer's terrifying wildfire season.

William R. Perritt, Executive Editor of the Wood Biomass Market Report and News Editor for the International Wood Fiber Report, works from his Lost River, WV, office and can be reached by e-mail: wperritt@risi.com.

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